Hard Choices

Whitman knew that hard choices were needed. These included making major changes to her senior management team to get rid of infighting and promote much-needed cooperation and constructive engagement. Major job cuts (34,000) had to be made to address cash flow and market realities. However, she also clearly signaled a return to the organization’s roots, by restoring funding and executive support for what was then a gutted and demoralized R&D function, symbolizing their commitment to innovation. She made the need for change salient to organizational members and highlighted a sense of urgency. The enterprise was restructured to better align it with the emergent strategy, and she reinforced the importance of having a clear customer focus. Further, she created a vision for the future that offered employees reasons for hope and regenerated shared commitment through the focus on teamwork, collaboration, excellence in execution, and shared celebrations of success. Changes of this magnitude do not happen overnight. HP’s impressive return to cultural and financial health by 2014 (stock price up 300% since 2011; being recognized as one of the 100 top employers in Canada in 2014) show that they were well on their way.61 There were drops in revenue, profit and unit performance in 2015 and 2016, but these had rebounded nicely by 2017. Its share price was approximately 2.2 times its 2016 low by January 2019.

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